Main menu

Post navigation

Commerce platform iZettle raises $47M at a $950M valuation

iZettle — the commerce platform based out of Stockholm that competes against companies like Square, Paypal and SumUp to provide card transactions use smartphones and tablets as well as related accounting services — has raised another EUR4 0 million ($ 47 million) as it approaches a$ 1 billion valuation. CEO and co-founder Jacob de Geer told TechCrunch the money will go towards expanding into more marketplaces beyond the 12 where it currently operates in Europe and Latin America.

The company declined to disclose its valuation, which last was at EUR5 00 million( about $584 million) in its Series D.

“It’s absolutely an upround, ” De Geer said in an interview. “We tend to have an internal saying that the valuation of the company is the sum of all the problems that we solved, and we’ve solved millions of those so the valuation should be in line with that.”

However, Swedish publication Dagens Industri, which reported rumors of the funding yesterday, pegged the valuation at the time at $948 million (8 billion Swedish crowns ), and we have confirmed that figure with our own sources.

“What you see right now is a proof point that the company is doing exceptionally well, ” De Geer said. “In the last couple of months, we’ve had significant growth that led to taking the decision to accelerate the business.”

As for which countries it may tackle next, he said that Central and Eastern Europe were “absolutely” in iZettle’s sights alongside more growth in Latin America.

“It’s interesting to see how Poland, for example, is very well advanced in contactless pays, ” which many see as a key driver to less cash use and more card use in general. “It’s a big market and very mature.”

This latest equity funding is led by previous backer Dawn Capital, and the committee is also brings a new, solid institutional investor into the mixture for iZettle, the Fourth Swedish National Pension Fund, alongside other existing( but unnamed) shareholders.

Past investors into iZettle have included the Spanish banking giant Grupo Santander( whose backing fuelled iZettle’s move into Mexico and Brazil ), American Express, MasterCard, Intel, Index Ventures, Northzone, 83 North and Creandum , among others. De Geer said that iZettle has raised around EUR2 00 million ($ 235 million) in equity funding to date.

De Geer declined to give any specific numbers on growth — quoting the fact that iZettle will soon close accounts for the year and report numbers then in accordance with Swedish statute. As a marker, however, the company noted a 60 percent rise in revenues in its last coming fiscal year and expected to narrow its loss year. In FY 2016 it had revenues of 643 million Swedish crowns ($ 76 million ), up from SKr4 02 million in 2015; its net loss was SKr2 28 million versus SKr2 95 million in 2015.

De Geer said iZettle is strong in the UK in particular — which is notable not just because the UK is a large market for commerce, but because it’s also highly competitive, with Square choosing it earlier this year as its first point of European expansion.

De Geer said one key reason iZettle is grow so much is because it’s doing more than only pays for its chiefly SMB customer base. “Our commercial and business platform devotes us the possibility of cross-selling other solutions, ” he noted.

Those other services include cash advances and invoicing, with more to come. iZettle has been investing this year in machine learning and other AI tech( partly by way of a loan from the European Investment Bank) and that is helping the company run assessment of risks for cash advances and potentially will be used more for supplementary products down the line.

“We are learning! ” he said in reference to the company’s push into machine learning. One of the more interesting applications of AI has been in financial services, used to assess risk for loans( this is what another loans platform, Kabbage, has built its business on for example ). Now iZettle is looking at how it can use its deep learning technology to develop other services it can cross-sell in areas like client data and analytics.

This expanded opportunity, in fact, was what attracted iZettle’s newest investor.

“We invest heavily in companies contributing to sustainable economic growth and are impressed by how iZettle has levelled the playing field for small businesses, ” said Per Colleen, head of fundamental equities at The Fourth Swedish National Pension Fund, in a statement. “We believe in iZettle’s long-term development opportunity through their data-rich technology platform, built for scalability be included with five years of unique insights about the needs of small businesses, which induces it an attractive investment case.”